Dubai’s DP World says won’t renew Indonesia port contract

English

The announcement comes after DP World confirmed a deal with the Indonesian government to advise on port development in July

Dubai ports operator DP World has said it will not renew an operating contract for PT Terminal Petikemas Surabaya (TPS) in Indonesia when the agreement ends in 2019.

In a statement, chairman and CEO Sultan Ahmed Bin Sulayem said operating contract renewal terms offered by the Indonesian authorities did not meet the company’s “threshold for continued investment”.

DP World is a 49 per cent shareholder in TPS, which represents 2.1 million twenty-foot containers out of the 85 million the group manages.

The company has managed the port for 20 years but said there would be no “material financial impact” on the group following its decision.

“It is unfortunate that the significant positive contributions made by global terminal operators in Indonesia have not been fully recognised, despite our successful track record,” Sulayem said.

Operations will be transferred in accordance with the terms and conditions of the contract.

The announcement comes after DP World confirmed a deal with the Indonesian government to advise on the development of the Kuala Tanjung greenfield port and logistics zone and Belawan port in North Sumatra in July.

It was unclear whether the decision would affect the agreement.

“We remain committed to investing in Asia and all geographies that have an appetite for foreign direct investment,” Sulayem added.

Source: 
gulfbusiness
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