Reason behind container terminal concession

Namport’s decision to give a foreign port container terminal operator the reigns to manage its N$4,2 billion container terminal at Walvis Bay is due to global dynamics in the shipping industry which resulted in a significant decline in the volumes throughput through the terminal. According to Namport CEO, Andrew Kanime, the port authority needs to earn a return on the strategic investment of the terminal and therefore was compelled to consider concessioning it to an independent operator. In layman’s terms, concessioning is the process whereby an asset, owned by the public sector, is availed for operation and management by the private sector, for a defined period of time at a fee and undertakings of mutually set investment upgrades. This does not entail selling off the asset, but rather a specialized lease arrangement where the operator runs the terminal and handles the containers in lieu of an upfront payment to the concession grantor (being Namport in this case), making volume related payments during the tenure of the concession and introducing additional capital for investments as well as driving operational efficiencies in the business.Namport wants this concessions to generate sustainable volumes. The operator is thus expected to consolidate and help facilitate organic growth of transhipment and domestic volumes. As the primary driver of high growth, transhipment volumes should be the main source of growth. The operator should also increase corridor volumes leveraging off increased vessel calls at the terminal as the secondary driver of growth.Furthermore, Namport wants the operator to improve efficiencies in line with the standards of a transhipment terminal as well as be prepared to bring investments to a combination of three fronts. These includes the purchase of new cargo handling equipment to improve operations efficiencies; deepening the channel to accommodate larger vessels and drive transhipment volumes growth; and expanding the quay wall to allow for the simultaneous docking of 300 – 350 length overall sized vessels, and yard expansion to accommodate additional volumes. Protecting employment is a top priority, said Kanime, and the concession holder will be responsible to protect the employment of the current personnel at the container terminal based on expected high growth in transhipment volumes. A final and primary objective of the concession is to generate sufficient income to service the N$2,9 billion loan due to the African Development Bank, while the secondary objective is to generate sufficient income to finance all expenses and other operational requirements of the terminal. A tertiary objective is to generate enough income to distribute dividends and returns to the shareholder, which is the Namibian government. The concession is expected to come into effect at the start of next year.

Reason behind container terminal concession

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Republikein 2025-09-17

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Reason behind container terminal concession

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Republikein 2025-09-17

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