Djibouti’s Doraleh Container Terminal Delivers
February 22, 2010—The resource-poor, but strategically located nation of Djibouti is beginning to emerge as a key trade gateway for the member nations of the Common Market for Eastern and Southern Africa (COMESA). This is in large part due to the construction of Djibouti’s new state-of-the-art container terminal operated by DP World of Dubai. In December 2007, MIGA underwrote $427 million in guarantees supporting the construction of the Doraleh Container Terminal. MIGA covered an equity investment by DP World, as well as a swap agreement and syndicated financing led by Dubai Islamic Bank. The transaction was an important milestone for MIGA as it was the agency’s first-ever guarantee for Shariah-compliant project financing. The project was also named Project Finance magazine’s African Transport/Ports Deal of the Year for 2007.
Gero Verheyen of MIGA recently met with the lead financing agents of the project and noted the significance of the project’s success. “The increased port traffic is opening up new opportunities for investment and growth for Djibouti now that other African countries are using the port as a gateway. Before the new terminal opened, 85 percent of incoming cargo was destined for Ethiopia with only 15 percent reaching other destinations in the region. Now the gap has narrowed to 60/40 percent.”
Indeed, since the first ship entered the new port in December, 2008, the project has been delivering impressive results. Operating at a current rate of 45 containers per crane per hour, the Doraleh Container Terminal (DCT) ranks among the top five of all DPW ports in terms of units offloaded per hour. This is even more impressive given that the terminal was originally scheduled to begin operations in January 2009. During 2009, DCT matched and then exceeded by 45 percent the capacity of Djibouti’s old terminal. With the completion of on-site container storage facilities expected soon, the port will be able to offer more services.
With its strong performance, the Doraleh Container Terminal is being used by DPW as a facility for best practice training in port management, including offloading, customs clearance, and security related issues. In August 2009, the terminal was certified by Lloyds Register as fully compliant with the stringent ISO 28000: 2007 security standard. Doraleh is part of a mega-port initiative under which all containers must be scanned by 2012, and is the first port in Africa to be compliant. According to DPW, container clearance typically only takes 24 hours from the time of off-loading – whereas clearances at the Ethiopian border can take significantly longer. In order to alleviate the differences in clearance times, DCT has established a joint clearance process whereby Ethiopian customs officials have an office in the port facilities.
“This project really is groundbreaking,” noted Verheyen. “Not only is it setting technical and efficiency standards for other port operations, but it is located in one of the world’s poorest countries and serving as the backbone for the nation’s economy.”