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Country “Illegally Seizes” DP World Terminal

Country “Illegally Seizes” DP World Terminal

East African state Djibouti has seized complete control of a DP World container terminal after a hostile legal dispute over the facility, according to reports.

President Ismail Omar Guelleh of Djibouti said his government had “…decided to proceed with the unilateral termination of the concession contract awarded to DP World.”

DP World has confirmed that the terminal has been seized, adding that it is also one of the biggest employers in the country.

“The illegal seizure of the terminal is the culmination the government's campaign to force the DP World to renegotiate the terms of the concession,” DP World said in a statement.

Adding that “The [Djibouti] government's conduct is particularly oppressive and cynical.”

Technical Paper: Container Trades of East and Southern Africa

DP World and Djibouti have long been in a battle at the London Court of Arbitration, with the East African state originally granting DP World a concession to run its key terminal.

After this, Djibouti claimed DP World’s actions had been unfair, however DP World has been cleared of any wrongdoing in an international court.

It is unlikely that DP World’s earnings will be affected in any meaningful way due to the seizing.  

Some outlets are reporting that Djibouti is concerned that the UAE is setting up military bases in the region, which has led to the present situation.

No final outcome has been suggested yet, although extra pressure will no doubt come onto Djibouti from neighbouring Ethiopia, which has 95% of its trade coming through the country’s ports.  

Read more: DP World Head Shares Plans for India’s Ports