Latinports Newsletter September-December 2011

September-December 2011Year 3, No. 3

Container Management of London: Interview to the Chairman of the Executive Committee of Latinports, Richard Klien

Ultramar Group, Principal Port Operator of Chile, Enters Latinports

Cepal Urges Significant Investments in Port Infrastructure in Latin America

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Excellent Level in the Colombian and Latin American Congress of Ports in Cartagena

CONTENTSSeptemberDecember

2011

TrainingLatin American Port News

Mail

Ultramar Group, Principal Port Operator of Chile, Enters Latinports

Large Shipping Companies Combine to Reduce Costs

Success of the First Specialized Seminar of Latinports: Reactivation of Upstream Navigation in the Magdalena River in Colombia, a Country Project

Executive Director of Latinports Meets with the Management Council of the Association of Terminals and Port Operators of Mexico

Executive Director of Latinports Represents Latin America in the Global Ports Conference of London

Cepal Urges Significant Investments in Port Infrastructure in Latin America

Excellent Level in the Colombian and Latin American Congress of Ports in Cartagena

Container Management of London: Interview to the Chairman of the Executive Committee of Latinports, Richard Klien

Editorial

DiseñoJulian [email protected]

PortadaLogo of the Colombian and Latin American Congress of Ports on the Map of Latin America.

http://www.miroamarillo.com

mailto:studio%40miroamarillo.com?subject=Desde%20el%20informativo%2C%20Info

September-December 2011CONTENTSSeptemberDecember

2011

EditorialWe bid fareWell to year 2011 and Welcome 2012 With very good neWs: After the success of our first Latin American Congress held in Brasilia on August 2010, on the occasion of the 50 years of the foundation of the capital of Brazil, we would like to emphasize the development in Cartagena during the first week of December of the Second Latin American Public-Private Port Congress and the First Colombian Congress of Ports, jointly with the Superintendence of Ports and Transportation of Colombia. This public-private annual congress, developed to commemorate 20 years of the law of ports in Colombia, was very well welcomed internationally, as demonstrated by the participation of representatives coming from more than ten countries, including Japan, Holland and Spain. In addition, within our strategy of dissemination and training, we must mention the international event on navigation in the Magdalena River held in September, the first specialized event of many to come (the excellent response received has encouraged us to start programming the next congress, this time in Mexico on legal security of concessions, date yet to be determined).

Worth mentioning is also the acknowledgment received from Lloyd’s Maritime Academy and the Group Informa of London, through the invitation to represent Latin America in the Global Ports Conference on emerging markets on December 1st; on this occasion our presentation dealt with Port Investments in Latin America, presented before a large group of European investors and also from other parts of the world, which was qualified by the organization of the event as “very informative and well received”.

Finally, and with great satisfaction, we have registered the affiliation to Latinports of the Ultramar Group of Chile that through its affiliate Inversiones Neltume is the principal containers operator of that country, operating eight terminals. The affiliation of the Ultramar Group to our association is a matter of great historical importance as Chile was the pioneer country in decentralizing and privatizing ports in Latin America, and Ultramar the most important representative of such a successful transformation.

May this be the opportunity to wish all Latinports affiliates and the Latin American port sector in general a successful 2012.

Until the next!

[email protected]

www.latinports.org

Julian Palacioexecutive director

mailto:jpalacio%40latinports.org?subject=

http://latinports.org

September-December 2011

EXCELLENT LEVEL IN THE COLOMBIAN AND LATIN AMERICAN CONGRESS OF

PORTS IN CARTAGENA

On the occasion of commemorating this year 20 years of the law of ports of Colombia, which in good time served to transform handling of foreign trade in the country, and coinciding with the signing of the FTA with the United States, the Latin American Association of Ports and Terminals, Latinports, jointly with the Superintendence of Ports and Transportation, conducted at the Hilton Hotel of Cartagena on December 6-7, the First Colombian Congress of Ports and the Second Latin American Congress of Public-Private Ports, which focused on Good Practices in the Port Node.

The event, co-sponsored by the port corporations of Buenaventura and Barranquilla, was opened by the Superintendent of Ports and Transportation of Colombia, Juan Miguel Durán, who was

accompanied at the inaugural session by the Chairman of the Executive Committee of Latinports, Richard Klien, the former Minister of Ports of Brazil and current Director of the National Water Transportation Agency, Pedro Brito, and the Executive Director of Latinports, Julián Palacio.

Focused on the Good Practices of the Port Node, the agenda was discussed in one and a half days, and on the opening, the Executive Chairman of Latinports, Richard Klien, stated the following in relation to this Second Latin American Congress:

“The foundation of the Latin American Association of Ports and Terminals just over two years was looking for a backbone that would bring us together, and this challenge of public-private cooperation became a strategy to combine, not to face. This


is the reason that led me to accept being the first chairman of Latinports.

“Last year’s Declaration of Brasilia (conclusions of the first public-private port event of Latinports held to commemorate 50 years of the creation of the capital of Brazil), which may be consulted on the association webpage, gathers in a single sheet these conclusions that diagnosed long-term port development, investments in infrastructure both in the public and private sectors, multimodality integrating transportation logistics and public-private associations as promoters of the great challenges of the market, having in mind that investments in infrastructure are for the long-term.

“Fifty-five years ago a U.S. trucker transformed the world with an idea: the container, although its

development only began to take force 30 years ago. This invention had a deep impact on general cargo transportation and encouraged closer relations between governments and the private sector for investments worldwide.

“Transportation price of consumer goods is today a very small part of the price of products and thus the success of the container must always be remembered as overwhelming. THE CONTAINER IS RESPONSIBLE FOR GLOBALIZATION.

“The market of capitals and scale economy also caused a real revolution in the handling of grains at ports.

Pedro Brito, exministro de puertos de Brasil y director de la Agencia Nacional de Transporte Acuático; Juan Miguel Durán, Superintendente de Puertos y Transporte de Colombia; Richard Klien, presidente del comité ejecutivo de

Latinports y de los consejos de administración de los terminales de contenedores Santos Brasil y Multirío; Julián Palacio, director ejecutivo de Latinports


“Our continent is young and has proven maturity and responsibility in the economic, financial, political and social fields. At our ports, the strong demand generated by a differentiated economic growth of our region, imposes challenges to our governments and to our entrepreneurs. That is why I hope this event has continuity, exchanging experiences and discussing strategies to unite around real and effective proposals, capable of promoting efficiency along the entire logistics chain that moves through our ports”.

The Superintendent of Ports and Transportation of Colombia, Juan Miguel Durán, upon declaring the opening of the event, stated the following in relation to the First Colombian Congress of Ports:

“Today we are celebrating the First Congress of Ports of Colombia with the participation of port corporations and special guests, which shall be the first of many more we will have in our country. This is a space to exchange experiences and learn the good practices of the ports of the world; we may be able to consolidate conclusions to better accomplish efficiency and competitiveness.

“This congress coincides with a very special year for the sector: 20 years ago was passed Law One, which has great significance as it determined decentralizing and privatizing ports in Colombia and the creation of the General Superintendence of Ports, today the Superintendence of Ports and Transportation.

“It is with great pride that the Superintendence sees the good changes generated in these 20 years within the sector, extremely positive for the government and investors that believed in it. However, it is clear for us that the success of this sector is based on the fact of being ever more competitive and that we may be able to obtain these good global practices and correct those that may not be the most efficient ones.

Chairman Executive Committee, Latinports Superintendent of Ports and Transportation


“We have great challenges, such as the free trade agreements signed or about to be signed, which are extremely valuable for Colombian economy and competitiveness. Ports have assumed this great challenge and with the investments and projections we have seen with good eyes not only resolve but facts. That is why Colombia is being prepared to have a drastic turn in its economy.

“The Superintendence has especially focused on the sector and we have been working with the different port corporations (Sociedades Portuarias). This vision is not only Colombian but of the entire world, where besides the port, the other actors of the chain are essential so it can be even better, with lower prices and maximized efficiency, being this in what we have been working at sector and regional levels. Just sitting at the table with the Sociedades Portuarias, transporters, container yards, etc., we have achieved important results as the willpower and commitment of the sector exists to accomplish important results”. Presentations of the different lecturers mentioned below are available to all Latinports affiliates on webpage www.latinports.org

ministerio de Puertos de brasil: análisis logístico de una Política de estado Ministry of Ports of Brazil: Logistics Analysis of a State Policy- Pedro brito, former Minister of Ports and Director of the National Water Transportation Agency

good Practices in the Port node as differentiating effect - Julián villalba, manager, Latin American Association of Port Quality (Asociación Latinoamericana de Calidad Portuaria) (CAF-Valenciaport Foundation)- Joao gilberto campos, President, Institute of Technical Professional Training, Brazil

logistics activities areas as complement of Port activity - José maría langa, Director of Logistics Development, Port Authority of Valencia, Spain

multimodal transportation: Effects of Internal Transportation of the International Logistics Chain - Jan Willem Koeman, General Director of Pharos, Holland - alvaro galli, Consultant Paraguay-Paraná Waterway, Uruguay

tendencias en el transporte marítimo: largo ciclo de negocios y agitación a corto Plazo - ricardo sánchez, Jefe de Infraestructura y Puertos, Cepal

sea transportation trends: long business cycle and short-term turmoil- hidefumi ikeda, Special Investigator, Institute of Ports and Airports Research, Ministry of the Land, Infrastructure, Transportation and Tourism, Japan

Before the end of the event, which was closed by the Vice-minister of Infrastructure of Colombia, María Constanza García, there was an interesting discussion on the Latin American Port System, with the leadership of the Director of Latinports, Julián Palacio, and the participation of the

Exministro Pedro Brito


Superintendent of Ports and Transportation of Colombia, Juan Miguel Durán, the former Minister of Ports of Brazil, and the Director of the National Water Transportation Agency, Pedro Brito, the Chief of Infrastructure and Ports of Cepal, Ricardo Sánchez, the General Manager of

Pursuant to the Declaration of Brasilia 2010, it was found there have been significant advances in the region during the last year, but there is still a lot more to do to achieve the necessary competitiveness for Latin American foreign trade. Below are the conclusions of the II Latin American Public-Private Port Congress held in Cartagena on December 2011:

Port development:

- The ports of the region require significant investments in infrastructure to have them ready to receive vessels up to 13,000 TEU, which operate today in the main sea routes of the world; this will require substantial financial contributions in works to increase the capacity of terminals, especially regarding depth. However, if all ports must be prepared to receive increasingly larger vessels, care must be taken on the magnitude of the investments to dredge because due to locations regarding transshipment, and the markets regarding foreign trade, mega-container vessels will only arrive to some ports of the region.

Sociedad Portuaria Regional de Buenaventura, Domingo Chinea, and the Director of Planning of Integral Port Management of Altamira, Leobardo Robles. Product of this debate and of previous presentations was the Declaration of Cartagena 2011, its conclusions transcribed below:

declaration of cartagena 2011

transportation infrastructure:

- The region has learned to confront external volatility, in particular the challenges of the financial and economic crisis now faced by some European countries and the United States, but infrastructure and capacity development to meet challenges in the long term is yet insufficient. According to Cepal, infrastructure lacking amounts to about US$170 billion per year up to 2020, which represent more than 5% of the region´s GDP, the most representative among them being transportation infrastructure. multimodality and logistics:

- Although important measures are being taken in relation to multimodality, basically regarding waterways in countries such as Brazil and Colombia, the railroad sector still presents a considerable delay, and more attention should be given to this issue for the sake of competitiveness. However, regarding integral logistics, there is still much to be done, and for this reason it is a topic to be seriously considered

September-December 2011Mayo - Agosto 2011


Domingo Chinea, Managing Director of Port Society of Buenaventura and Member of the Executive Committee of Latinports; Ricardo Sanchez from ECLAC; and Julian Villalba from CAF

at the next annual congress of Latinports.

Public-Private association:

- Worth mentioning is the approval by the congress of Colombia of the Law of Public-Private Associations, a scheme that in maximum 30 years will serve for the development of ports, airports, railway system and anything infrastructure-related; thus, the private sector will meet the economic incapacity of nations to substantially reduce its retardation. This Colombian decision, already made and successfully operating in other Latin American countries such as Brazil, Chile, Argentina and Peru should also be made by other Latin American countries coinciding with the motto of Latinports: Governments and private sector working together for regional port logistics development.

Particular situation:

- Recommendations of Eclac in relation to regional policies for ports, in particular, the development of cooperation mechanisms in a field of competence, were favorably welcomed, especially by the Superintendence of Ports and Transportation of Colombia that proposed its start-up as of the year 2012. Likewise well received was the approach of the Latin American Association of Port Quality, also welcomed by the Colombian authority that announced undertaking periodical meetings at the ports with the actors of the public and private logistics chain to discuss the steps to follow regarding guaranteeing service quality.


INTERVIEW OF CONTAINER MANAGEMENT OF LONDON TO THE CHAIRMAN OF THE EXECUTIVE COMMITTEE OF

LATINPORTS, RICHARD KLIEN

Container Management presents the impressive progress of the ports and logistics industries of Brazil through the eyes of Richard Klien, President of Santos Brasil and Multiterminais, and Chairman of Latinports.

Richard Klien, Chairman of the Executive Committee of Latinports

braZil has good reasons to be oPtimistic desPite the global Panorama of today’s World

Brazil only adopted the containers market as of the end of 1990, once the Law of Port Modernization was enacted by Congress in 1993. Once the Port Authorities (Companhias Docas, controlled either by the federal or state governments) opened public tenders at a dozen public ports, resulted in the delivery of 17 terminals of containers to private operators.In 1997, Brazil only operated 11 ship-to-shore (STS) container cranes in all its container terminals, but by the end of that year the number would increase to 103 and by 2015 there will be in operation approximately 150 of these cranes. “Output of modern STS cranes is of 30 movement/hour in more than 18-21 lines, whereas former cranes

managed less than 20 movement/hour in 13 lines,” explained Klien.


mientras las antiguas manejaban menos de 20 movimientos/hora en 13 filas,” explicó Klien.

amaZing Progress after Port PrivatiZation: 1997-2011

• Output has moved from 1m to 5.5m containers.

• International commerce flow, which stopped at US$100bn during almost a decade, will increase at an estimate of US$480bn this year (although the increase in price of commodities has played an important role).

• Economic opening (flow of international commerce/GDP) increased from 12% to 25% during the period..

• Private operators have invested more than US$4bn in the reconstruction, expansion, and modernization of 16 public container terminals.

• BTP (a joint venture between MSC and APM Terminals) is building a new container terminal at the Port of Santos that shall have 1.1m more TEU capacity, which equals one third of the port’s current output.

In fact, in 2010, growth of international commerce of Brazil, compared to 2009, was the highest worldwide, according to the World Trade Organization, showing a growth of 38% in exports and 34% in imports – more than the percentage growth of China.

regUlatory environment: strong institUtions sUPPly the bases for a long-term groWth

Leônidas Cristino, the new Minister of Ports appointed by President Dilma Rousseff, in his lecture during the Second Seminar of Ports and Waterways on September 22, 2011, emphasized the creation of the Secretariat of Ports (Secretaria Especial de Portos – SEP) in 2007 as the determining factor for this exceptional performance. Pedro Brito, the first Minister of Ports of the country, started the regulatory framework with Decree 6,620 of 2008, establishing regulations for the development of new public ports.

Minister Brito used great part of the time in his position visiting all Brazilian ports and talking to everyone, until he had a clear idea of the industry and of the bottlenecks of the system. He also traveled extensively abroad, interacting with government officials, port authorities, and terminal managers of almost all container ports of the world, and also structured the Secretariat of Ports and promulgated the National Dredging Plan.

Having recognized the deficiencies in the original privatization tenders, which resulted in berths 250m long, while new vessels surpassed 300m long and required longer and deeper dock walls, and STS cranes with a greater reach, he also published the policy promoting the expansion of existing terminals to accommodate the new generation of super post-Panamax vessels arriving at Brazilian ports.


Minister Cristino also emphasized on government investments of R$2bn (US$1,064bn) to deepen the maritime access channels with resources of the Program for the Acceleration of Economic Development (Programa de Aceleraҫão do Crescimento – PAC).

In the same Seminar of Ports and Waterways, Fernando Fialho, chief of the National Water Transportation Authority (ANTAQ) revealed that in 2010, 99% of exported tons and 90% of imported tons were handled through ports, which corresponded to 85% of exports and 73% of imports, respectively, FOB value. The total output of Brazilian ports in 2010 reached 834m tons, of which 22% are domestic shipments (cabotage), 59% exports, 15% imports, and 4% internal waterways.

in the beginning

As a result of the liberation of Brazilian port industries, a number of new companies have evolved of which Multiterminais has emerged as one of the principal players. A complex organization, Multiterminais may be easily divided in two principal business areas, terminals and logistics, which include an increasing number of interests in container terminals, vehicle terminals, and dry docks in the interior.

In 1986, when Brazilian ports were operated by port authorities owned by the government, Multiterminais opened the first dry dock privately operated as bonded warehouse (Terminal Retroportuario Alfandegado – TRA), next to Tecon of Rio de

Janeiro. There were stored full containers and packed cargo in warehouses, which are delivered to importers after being liberated by customs. Eventually, 95% of all container imports of Rio going through these facilities and the company’s are very well known in the states of Rio de Janeiro and Minas Gerais, natural area to collect unloaded cargo at the Port of Rio.

When the Port Privatization Law was enacted in 1993, Multiterminais participated in the tenders of two container terminals in Rio de Janeiro. Multiterminais was granted the Tecon 2 concession in 1997 and then also the adjacent ro-ro terminal for vehicles, which are currently operated by MultiRio and MultiCar, respectively. Nowadays, the company is owned by the Gavea Investment Fund and the Klien family.

According to the company, Multiterminais operates one of the most sophisticated logistics platforms of Brazil, being pioneer in the integration of port logistics with the interior. “We supply the automotive industry a complete service ship-to-plant, just in time (JIT) and just in sequence (JIS). Clients have complete visibility in real time at any point of the supply chain at an individual part-by-part level. This enables client to have a constant monitoring of the cargo flow along the entire supply chain and to readjust production schedules as required”, states Klien.


Most recently, Stahllog, an affiliated company specialized in Logistics and Port Services for the steel industry has been engaged to unload imported coal and load export steel plaques at the new private terminal of the Thyssen Krupp-CSA plant in Itaguai, in the Bay of Sepetiba.

tecon santos

Multiterminais has participated from the start in the privatization of the Port of Santos and Tecon Santos was granted to the Consortium of Santos Brasil during the public tender that was held by the Stock Exchange – BOVESPA – in 1997.

The dock of the container terminal has a length of 500m and the third berth of 250m was finished in 2006, thus complying with contractual obligations. In 2010 an extension of 230m must be built – thus providing a total dock length of 980m – enabling the simultaneous berthing of three super post-Panamax vessels. On some occasions, the adjacent berth of 310m of the Terminal of Vehicles (locally known as TEV – Terminal de Veiculos), opened in 2006 and awarded the tender to Santos Brasil in 2009, operates container vessels when not used for ro-ro (roll-on – roll-off) vehicle vessels.

the Port of santos becomes no. 1 in the soUthern hemisPhere

In 2010, the Port of Santos became the largest container port of the southern hemisphere, according to Better Container Ports of the World of CM. This was mainly possible because of the investments for R$1,8bn of Santos Brasil in the terminal.

The first STS cranes with double lift in the Americas were contracted by Santos Brail and have been operating in Tecon Santos since 2010. Its two spreaders-collectors lift containers of 2 x 40 feet or 4 x 20 feet, driving output in 35% per movements/hour/vessel in 2011.

Despite the expected growth of 11% for 2011, productivity gains, and the termination of the dredging of the basin at the Port of Santos has virtually eliminated waiting times of vessels, and the shipping lines have expressed their thanks for the levels of performance. One million boxes will be handled by Tecon Santos in 2011, while the maximum capacity of the terminal is estimated in 1.45m boxes.

tecon imbitUba

In 2008, Santos Brasil was granted the concession to build a deep-water container terminal within the Port of Imbituba, which includes two docks for a total of 660m with a depth of the side of 15m and an annual capacity of 700,000 TEU. Total planned investment for engineering works and equipment amounts to R$312m for 2012 and R$278m have already been invested.


Multiple user facilities have placed priority on mooring container vessels; these are currently equipped with two gantry cranes ZPMC super post-Panamax, which have been added to the two existing mobile Gottwald cranes.

santos brasil logistica

In November 2007, Santos Brasil acquired Mesquita, later called Santos Brasil Logistica, which has two Centers of Customs and Industrial Logistics (Centro Logístico e Industrial Aduaneiro – CLIAS), located at the two margins of the estuary of the Port of Santos.

It also has two distribution centers, one in São Bernardo do Campo and the other in Jaguaré, both next to the city of São Paulo.

“Today we are using Santos Brasil Logistica as an extension of Tecon Santos, which has already proven beneficial for our clients thanks to a more efficient supply chain now applied to all cargo movements going through our terminal,” says Klien.

At Imbituba, Santos Brasil Logistica offers cargo services for port operation projects, general cargo port operations, filling and emptying containers, storage of general cargo and door-to-door logistics services.

marKets Join to ParticiPate in braZilian infrastrUctUre ProJects

Several companies have profited of the enthusiast contribution to the market of capitals in development of the industries of ports/terminals and cabotage in Brazil. Santos Brasil, the first port operator of Brazil to launch its IPO (Initial Public Offering – first public offer of shares), was a pioneer in the stock market of Brazil and obtained R$933m by flotation of its shares. Wilson Sons, Long-In and most recently LLX Logistica have followed the example by listing its shares in the BOVESPA/BMF Stock Exchange.

Comparing Tecon Santos of today with that of 1997 if both interesting and illustrative:


Santos Brasil, with a capitalization market of R$3,15bn, is under the control of the Opportunity Group through IMI (Investments in International Markets), of PW 237 Group, and Multi-STS and Brasil Terminais, property of the Klien family.

In February 2010, Multi-STS started an arbitration process to dissolve the corporation, but Klien emphatically refused to make any comments on this matter because of the confidentiality agreement. “We expect an acceptable award for both parties in the near future”, was all he said.

The partner of Multiterminais, the Gavea Investment Fund, directed by the former president of the Central Bank, Arminio Fraga, has given the company a clear growth mandate in the markets of Rio de Janeiro and Minas Gerais.

the formUla for sUccess: PUblic and Private cooPeration

During the first Seminar of Latinports held in Brasilia in August 2011, the authorities and businessmen discussed how to comply with the increasing challenges of ports and logistics industries. “A consensus was reached on the belief that public interest may be better achieved if private and government sectors work in close cooperation – long-term planning and focused on their corresponding responsibilities,” says Klien.

According to Klien, this exactly is what happened in Brazil. “SEP established policies, assured resources for the PAC program of the federal government to dredge sea access channels and developed (in close cooperation with municipalities) the necessary improvements for port land accesses. This encouraged private port operators to deepen and expand dock walls and berths and to increase productivity and storage capacity at container terminals.”

In September 2011, ANTAQ approved the expansion plan presented by the Port Authority of Rio (Companhia Docas do Rio de Janeiro - CDRJ) to extend the four existing berths for containers from 250m to 400m each and add a second ro-ro berth. Thus, the Caju dock will be extended from 1,258m to 1,960m, creating the most extensive continuous dock for super post-Panamax vessels in South America.


ECLAC URGES SIGNIFICANT INVESTMENT IN PORT INFRASTRUCTURE

FOR LATIN AMERICA

action shall see ports capacity quickly taken over. However, Prado also emphasized that this situation is an opportunity to give a technological and qualitative leap in Latin America, for the benefit of port competitiveness and its logistics connections, making emphasis in the need to reformulate public policies to reach a better planning and project implementation. Connectivity provided through maritime transportation services, corresponding logistics operations and transportation costs “determine our products competitiveness”, stated the Deputy Executive Secretary of Cepal, who also considered being a key factor for social inclusion because better services in transportation infrastructure in all its phases improve quality of life of the less favored sectors and of those that are far from urban or productive centers. According to Prado, “although the region has learned to face external volatility, and in particular the challenges of the financial and economic crisis now being faced by some European countries and the United States, development of infrastructures and capacities to face long-term challenges is still insufficient”.

On this matter, the Chief of Infrastructure and Ports of Cepal, Ricardo Sánchez, also referred to this during the presentation of the II Public-Private Congress of Ports of Latinports, held in Cartagena in the month of December. To that aforementioned, Ricardo Sánchez made clear that care must be taken on the magnitude of dredging investments, because as a result of the location of the east-west route in relation to transshipment, and the market in reference to foreign trade, the mega containerships will only be arriving to some ports

The study of the Economic Commission for Latin America and the Caribbean launched in mid-October in Santiago de Chile at the Annual Conference of the International Association of Maritime Economists (IAME), concludes that ports of the region require significant investments in infrastructure to be suitable to receive vessels of up to 13,000 TEU operating today in the principal sea routes of the world, require substantial financial contributions in works to increase terminal capacity, in particular regarding depth.

In fact, the Deputy Executive Secretary of Cepal, Antonio Prado, stated that the maritime industry, ports and logistics services play an ever more critical role as development and insertion international facilitators of Latin America, warning that infrastructure deficiency is of the order of US$170bn per year until 2020, which represents 5% of the region’s GDP. Consequently, lack of


hardly any trains, stated Notteboom, who also added that “this type of system makes it more difficult to create dry docks where may concentrate the logistics companies for the development of a type of logistics system”. To improve competitiveness in the maritime transportation world market, Latin America requires starting to consider ports as a part of an integrated system, instead of concentrating in developing each port individually, concluded the expert.

Latin America requires a new approach in relation to the internal logistics in order to compete within the international sphere, stated to BNAmericas Theo Notteboom, President of the International Association of Maritime Economists (IAME). Whereas the region is making great efforts to potentiate port capacity, initiatives tending to strengthen ports of the areas in the interior of the countries have been forgotten. Most Latin American countries depend greatly on truck transportation to connect with the interior regions and there are

of the region, although all its ports must be prepared to receive ever larger vessels, proportionately to the size of their markets.

latin america needs a new approach in relation to internal logistics: President of iame

Theo Notteboom,President of IAME


Through its affiliate Ultramar Inversiones Neltume, the principal containers operator of Chile, the Ultramar Group entered Latinports on Christmas Eve; thus this country, pioneer in port decentralization and privatization in Latin America, becomes a symbol within our Association.

Through Inversiones Neltume, the Ultramar Group undertakes the operation and development of the business of ports, and also the integral logistics projects of support to large mining, industrial and energetic developments in Chile and Latin America. Its eight (8) Chilean terminals (Terminal South Pacific, Terminal Port Arica, Port Angamos, Port Coronel, Port Mejillones, Terminal Mejillones, Terminal Graneles del Norte and the recently concessioned Port Terminal Coquimbo) move more than 20 million tons of cargo, including more than

1.2 million TEU. Montecom operates abroad in Montevideo, Uruguay.

The General Manager of Ultramar Inversiones Neltume is Melvin Wegner [email protected] and the Manager of Development, Fernando Reveco [email protected]

ULTRAMAR GROUP, PRINCIPAL PORT OPERATOR OF CHILE, ENTERS

LATINPORTS

http://www.ultramar.cl/neltume.php


the “Company of the Year” by the Lloyd’s List in ceremony that took place on September 20 in London.

The French line CMA-CGM announced in November an Alliance with the Mediterranean Shipping Company MSC, its object being to face the excess capacity of traffic between Asian, Northern Europe, South African and South American routes. Following the world crisis, commercial exchange has declined, pressing down maritime freights, he explained, affirming that the cooperation is in favor of “operational synergies”, without mentioning mergers or acquisitions. Additionally, the cost of fuel increased 40% in November 2011 compared to the same month of 2010, according to market figures.

Information shows that the agreement will start in March and initially shall be for two years. Altogether, MSC and CMA CGM shall have a fleet of 3.6 million TEU, overcoming the 2.5 million TEU of the leader of this industry, Maersk. In number of vessels, the agreement between MSC and CMA-CGM will total 877 ships, against 654 of Maersk. This association implies a vigorous cost-cutting plan, the goal being to cut US$400 million annually. The CMA CGM group was acknowledged as

LARGE WORLD SHIPPING LINES COMBINE TO REDUCE COSTS: MSC AND CMA-CGM ENTER A

GLOBAL COOPERATION AGREEMENT


This event was attended by three international lecturers of the highest level, one of them the General Director of the National Water Transportation Agency of Brazil, Fernando Fialho. With the room full, presentations of foreign lecturers and national experts were excellently received and subject of the most interesting discussions, thus leaving the clear conviction of great possibilities for the Magdalena River to become the principal artery of Colombia, both from the technical-operational and economical-financial viewpoint. Below you may find the conclusions of the presentations of each of the lecturers:

Tim Stater, Economic Counselor of the Embassy of the United States: Informed of the grant of the government of the United States to Sociedad Portuaria Multimodal del Río Magdalena for the

final studies that concluded with the viability of the project, and states the government of the United States was willing to continue supporting the project.

Fernando Fialho, General Director of the National Water Transportation Agency of Brazil: He showed what has been done by Brazil in waterway matters, where at present river transportation represents 13% of the total (compared to almost 0% in Colombia) and the decision of its government to reach 29% in 2025; at that time this mode of transportation must represent the same percentage as road and railroad transportation, in order to basically facilitate providing productivity to the impoundment of grains.

SUCCESS OF THE FIRST SPECIALIZED SEMINAR OF LATINPORTS: REACTIVATION OF UPSTREAM

NAVIGATION IN THE MAGDALENA RIVER IN COLOMBIA, A COUNTRY PROJECT

Fernando Fialho, General Director National Water Transportation Agency

Brazil


Rob Davinroy, Director of the Application Center of Waterway Engineering of the Corps of Engineers of the Army of the United States in St. Louis, Missouri, and Principal Consultant for CDG Engineers: Mr. Davinroy, as part of the team that at the time of the conference was finishing the feasibility study for channeling works to increase the upstream depth to 6 feet, stated that the present situation of the Magdalena River upstream, regarding depth, is the same of the Mississippi River 150 years back, but with an advantage: Colombia has oil as basic cargo for a successful take-off, which was not the case of the Mississippi river at the time.

Alvaro Galli, Uruguayan Consultant expert in the Paraguay-Paraná waterway: As part of the team that developed the final study that resulted in the viability of the port and navigation project to and from the center of Colombia, he emphasized on the great possibilities of such project, with the advantage that unlike the Paraguay-Paraná waterway, development of navigation in the Magdalena River implies easier

decisions as it depends on only one country, whereas the great waterway south of the continent involves five countries. With all the difficulties implied for an agreement between five Latin American countries, in less than 20 years as of the creation of the River Transportation Agreement for the waterway of the Paraguay and Paraná Rivers in 1992, cargo movement moved from one million tons to 16 million tons in 2010. In addition, he showed how the country with the largest fleet is Paraguay, upstream of the waterway, where it has the lowest depth.

Jorge Enrique Sáenz, Manager of Emdepa Consultoría de Colombia: A consultant with more than 36-year experience in studies of the Magdalena River, presented an educational lecture called Myths and Realities, by which it destroyed all the myths that existed on the impossibility of having an important upstream navigation, further showing the great difference in costs compared to new roads, railroads and pipelines. He also made a comparison with the Mississippi River showing

Consultores y conferencistas Jorge Enrique Sáenz (Colombia) y Alvaro Galli (Uruguay), en los extremos, y Paulino Galindo, asesor técnico de Cormagdalena, en el centro.

http://www.atpaltamira.com.mx/


how the Mississippi upstream and downstream had 4.5 feet in 1875 (where we wish to arrive at in 2012 in the Magdalena River), to 6 feet in 1990 (what the Colombian Government expects to arrive at in two year time according to decision of the board of directors of the competent authority, Cormagdalena), and to 9 feet (which President of Colombia, Juan Manuel Santos hopes to achieve by the river concession called “the large project”, with a public-private association which is being structured and is to be awarded prior to the end of the present administration, in 2014).

Edgar Higuera, Executive Director of the Chamber of Large Users of Logistics Services of the ANDI (Asociación Nacional de Empresarios): In a very interesting presentation he showed how the multimodal node Puerto Salgar-La Dorada, located in the center of the country, has the basic conditions required for inter-modality, and within the possible nodes of multimodal integration detected by a recent study of the Ministry of Mining and Energy, called Integrated Infrastructure of Multimodal and Logistics Transportation for the Development of the Mining Industry in Colombia, the Puerto Salgar-La Dorada node, within the options studied in the Matrix of Physical Aptitude of the Potential Nodes, is the only one that, once the operation upstream reactivates, would meet all requirements, basically as it has a railway intersection.

As a result of the above, the Minister of Transportation reiterated the wish of the President of the Republic in the Project, creating a reduced public-private follow-up committee of which is part the Executive Director of Latinports, Julián Palacio, to help in promoting in the shortest time possible, the following:

short term: A minimum permanent draft of 4.5 feet upstream (250 km), tender that was closed in

December to develop works in 2012, thus an early operation may be started by the end of 2012 or beginning of 2013.

short-medium term: Managing regional and national resources to make a minimum permanent draft of 6 feet in the same stretch aforementioned through channeling works, procedures that up to the completion of works would last two years. As resources are expected to be obtained in December, this new phase would be operative in the first semester of 2014.

medium-long term (river concession from the first navigable port in the center of the country, Puerto Salgar, to the mouth of the river in Barranquilla/Cartagena, guaranteeing a minimum permanent draft of 9 feet by means of channeling works): A public-private, mostly private corporation will be established, to be responsible not only of channeling and maintenance works of the navigable channel, but also of the development of the basin in all its fronts. This project must be structured, and tender opened and awarded in 2013.


EXECUTIVE DIRECTOR OF LATINPORTS MEETS WITH THE MANAGEMENT COUNCIL OF THE ASSOCIATION OF TERMINALS AND PORT OPERATORS OF MEXICO

(ATOP)

PUpon the invitation of the new President and Executive Director of ATOP, León Fregoso and Jaime Aguilar, respectively, the Executive Director of Latinports, Julián Palacio met during the last week of October in Mexico D.F. with the management council of this association in full, during which time was discussed the interest of the association of holding in 2012 a specialized seminar on the modification of the law of ports in this country, and also the postulation of Mexico as host of the IV Latin American Public-Private Port Congress in 2013, to be jointly held with the Annual Congress of ATOP. This coincides with the Presidency of the Executive Committee of Latinports that will be next year in the head of its present Vice-president, Arturo López, founder of the Association of Terminal and Port Operators of Mexico, ATOP and also President of Altamira Port Terminal.

ATOP, one of the greatest promoters of Latinports, has defined as its main purpose since its creation 15 years ago to safeguard and promote the interests of its affiliates, by means of different tasks that go from

the institutionalization of a permanent forum to exchange experiences, knowledge and dissemination of the best entrepreneurial practices for the sector at international level, up to the preparation, management and lobbying of laws and regulations applicable to the port activity, among many other actions towards the consolidation, strengthening and development of its companies. In matter of legislation, the association recently prepared a proposal for the modification of the Law of Ports, its contents currently being debated in the Congress of the Union.

In its relationship with port authorities, ATOP is acknowledged as speaker of the sector of terminals and port operators, validated by the representation granted by 40 terminals of the country affiliated to the organization and operation of container cargo, agriculture grains, minerals and liquids, general cargo and cruisers. At the present national occasion, ATOP is convinced that the joint, coordinated and consensual action of companies, authorities, service providers and other actors of the port community, constitute the best policy to find solutions for the problematic now being faced by the sector and representing an equal challenge for all.


The Executive Director of Latinports, Julián Palacio, represented the region in this industry-leader event with a conference on “Investments in Latin American Ports”, organized annually by Informa Maritime Events in association with Lloyd´s Maritime Academy. In this event, held on November 30-December 1st in London, principal actors of the sector discussed the last developments in emerging market investments, global trends and infrastructure construction, which served to obtain answers to key questions that define the sector of ports worldwide, such as global port sector trends, the changing phase of shipping lines, the increasing markets and their opportunities, and investments in Latin American and African emerging markets.

Regarding the conference of the Executive Director of Latinports, the panel was shared with Patrick Verhoeven, General Secretary of

ESPO (European Seaports Organization), and was focused to the opportunities Latin America represents as an emerging region, unique in the world that (quoting Moisés Naím, expert of the Program of International Economics of the Carnegie Endowment for International Peace of Washington), “has known how to navigate through the world crisis without derailing, to handle its public finances with caution and also has known how to regulate its banks”. The producer of the event, Shelley Bullen, stated the conference of Julián Palacio “was very informative and very well received”.

EXECUTIVE DIRECTOR OF LATINPORTS REPRESENTS LATIN AMERICA IN THE GLOBAL

PORTS CONFERENCE IN LONDON


Training

new era for infrastructure investments in the andean region and central america

The Andean region and Central America show important investment opportunities for large-size infrastructure projects.

Regional governments are supporting private investment as never before. New laws and regulations, in addition to existing modifications, have been approved to render a safe return to investments in energetic, social, transportation and water infrastructure.

The scenario for opportunities is now more suitable than ever. Do not miss this great opportunity to participate where the opportunities to be discussed will forge your business for the years to come.the executive director of latinports, Julián Palacio, will participate in a round table on Port infrastructure and sea and Waterway transportation with a conference on the Waterway Project of the magdalena river.

to obtain more information please contact andrea briones [email protected] / (+562) 9410450

Bogotá, 28th and 29th of March, 2012 May 21- 25 Hotel Riu Plaza, Panama

Maritime Week Americas 2012 will take place in Panama, one of the most important maritime centers of the world and core of some of the most interesting changes that will impact world’s navigation, and ports and bunkering industries.

the executive director of latinports, Julián Palacio, will participate in a lecture on Post-Panamax vessels economy: Will the largest survive?, and will be the moderator of the session of the regional Ports round table: challenges in an Uncertain World.

For more information on this event please click on www.maritimeweekamericas.com or contact [email protected]

www.sp rb . com.co


Latin American Port NewsArgentina

negotiation for extension of concessions in buenos aires

According to Container Management, the concession to Hutchison of the Buenos Aires Container Terminal Services SA (BACTSSA) for Terminal 5 expires in 2012, while that of the DP World (Terminal Rio de La Plata) and of APMTerminals (T4) will expire in 2019. Until now there have been little signs of progress on the decision if these concessions will be renewed and when, greatly as a result of an ongoing dispute between the federal government and the city of Buenos Aires on which will have jurisdiction on them. The insecurity inherent to the deadline of these concessions has caused these terminals not to continue making any significant investments at their facilities. However, according to CM, a temporary solution has been reached by signing an extension of the concession of BACTSSA for a term equal to 20% of the original 18-year concession, which apparently is allowed by the original agreement. According to the above, the final conditions will supposedly be known very soon.

tecPlata foresees starting operations the second semester of 2012

Implementation of the first phase of the TECPLATA project of International Container Terminal Services ICTSI, at the mouth of La Plata River, 60 kilometers from Buenos Aires, is on track as informed by Container Management. This phase, with two 600-meter docks, 10.4 meters deep and a US$234 million investment, shall have capacity for 450,000 TEU and will be in operation in August 2012. The second phase foresees 220 additional meters of dock for a total of 820, which shall enable handling one million TEU. Total investment is estimated in US$370 millions.

Brazilodebrecht Participates in the expansion of the Port of miami

According to the Miami Herald, the US affiliate of the Brazilian construction company is starting improvement works at the port of Miami. Budget for these works is estimated in US$57 millions, and


secretary of logistics and transportation of the state of são Paulo announces the construction of a tunnel Joining the Port of santos to guarujá

Several newspapers announced that the municipalities of the Baixada Santista will be granted investments for almost US$1 billion from the state government for the construction of a 900-meter prefabricated tunnel between Santos and Guarujá, for truck transit, which had been discarded in the project of the suspension bridge. Estimates are that the new structure will be inaugurated in 2016. The Secretary Saulo Abreu explained that the dry binding will have a capacity for truck movement and did not discard the proposal of the bridge from the Council of Port Management (CAP): “We are not saying that the other suggested route, upon future port growth, is not important. This option benefits the port area and will decongest a very large traffic of vehicles to Santos (seven thousand daily) that would make it intransitable”, he clarified. However, according to Folha, the project does not meet the demands of Companhia Docas do Estado de São

Latin American Port NewsPaulo, CODESP, or of the companies operating in the port. “We are going to accelerate actions for a second connection” said Sérgio Aquino, president of the CAP of CODESP and Secretary of Ports of the State of São Paulo.

Tribuna interviewed the President of the CAP of CODESP and Secretary of Ports and Sea Matters of the Municipality of Santos, Sérgio Aquino (candidate for Mayor of the city), who emphasized that for him the Chinese model shows the importance generated by Brazilian ports of a new regulatory framework towards the modernization of port management, and thus, guarantee the dynamics required of the sector by the market. “The infrastructure is the one that will generate opportunities for the growth of a country”, stated the high official, who added that “no country wanting to become a competitive and developed country may achieve this without infrastructure”. Aquino concluded stating that China has been illustrating this from some time now, showing it is serious in matters of infrastructure in all its aspects.

President of the council of Port management, caP, of the companhia docas do estado de são Paulo defends regulation on the model of management and Ports

works include steel and concrete reinforcement of the berthing docks structure prior to dredging the port the beginning of next year. Depth will pass from present 14 meters to almost 16.5 meters.


Plan of Unasur included railway between Paranaguá and antofagasta

Based on the information supplied by the System of Enterprises SEP, the firm Ultramar was awarded the concession of the Port of Coquimbo –for 20 years,

Folha informed that the 12 Ministers of Planning of Unasur (Union of South American Nations) launched in Brasilia a new plan for the integration of regional infrastructure, with 31 priority projects for the next ten years, including 88 works among which

ChileUltramar group obtains concession of Port of coquimbo

Latin American Port News

An article of Tribuna informs that the Minister of Ports received in December the representative of the IBRD in Brazil to discuss proposals and investments of the group in the sector of Brazilian transportation. According to the article, the executives of the bank targeted cabotage as a form to integrate the transportation systems for the existing cargo in the country. At the same time, the Singapore Group visited the ports of Santos, Vitória and Itajaí, looking for information on the development of an integrated system that would served as support to the PIC of the Special Secretariat of Ports, SEP. The idea of SEP is that Singapore may cooperate to change the scenario of Brazilian ports, for which a final study is expected in the first quarter of 2012 with the solution proposal. Works will include the complexes of Santos, São Sebastião, Porto Alegre, Itajaí, Mucuripe and Pecém (these two in Ceará), Suape, Rio de Janeiro, Vitória and Manaus.

Project of incentive of cabotage (Pic)

are waterways, railways and road transportation lines, at a cost of US$16 billions. The project of greatest interest for Brazil is the construction of two railway lines to join the ports of Paranaguá, Brazil, and Antofagasta, Chile. João Mendes, responsible of this matter at the Ministry of Foreign Relations of Brazil stated that the focus of the Program of Strategic Action of the Council of Infrastructure and Planning of Unasur, shall be different to the IIRSA (Initiative for the Integration of South American Regional Infrastructure), as instead of product export corridors leaving the subcontinent, the internal development of the region shall be privileged.


To face the boom of exports of Latin America, so-called by Container Management, Maersk Container Industry MCI is building a new plant for refrigerated containers in San Antonio, amounting to US$170 millions, the first of its class in the region. Programmed to be operative by the end of 2013, and with an annual production capacity of 40,000 containers, the new plant will create 1,800 new jobs within the area.

More extensively, the company states this plant will help correct the refrigerated trade unbalance, affecting exporters of fresh products (fish and meat) of the west of South America, which annually shows tens of thousands of empty containers loaded in Asia and other parts. The new plant will complement production of the MCI plant in Qingdao, China, which is now being expanded.

maersk builds the first Plant for refrigerated containers in latin america

Latin American Port Newsextendible to 10 more–, after being the only operator that presented offers for the terminal of the Fourth Region, despite the 12 conglomerates that acquired tender specifications. The company committed investments for US$80 millions, with which it will add 25,000 square meters to port tasks. Among other works, a passenger terminal will be built. Likewise, equipment for transferring fruit of the region will be renewed and a new site for berthing of grains will be constructed, besides building a last generation negative pressure warehouse of 6,000 square meters.

Ultramar will receive the port between May and June 2012, and estimates are that the construction process will extend for a 30-month period, aligned with tender specifications, as informed the company. Melvin Wenger, General Manager of Investments Neltume, corporation through which Ultramar develops port management, stated that “it is a great honor for us and an immense responsibility to develop the project we have planned for the Port of Coquimbo. Our objective is to provide the city with a complete terminal, harmonizing and adequately potentiating cargo activities and passenger cruisers”.

Two million tons are expected to be moved in the next five years and for the end of the tender period this amount will be four million tons. It is recalled that during 2010, 168 vessels made landfall at the Port of Coquimbo and 396,121 tons were transferred.


SCF Marine, the operative unit of the division of Inland River Services of Seacor Holdings Inc., purchased the majority of shares of the Colombian company Naviera Central, thus becoming an important player in the reactivation of the navigation

The idea is to concentrate them getting them closer to the river through the ports of Puerto Salgar and Puerto Berrío (Antioquia), and to transport products economically to the ports of the Colombian Caribbean coast, allowing them to export at “better prices”, stated the Executive Director of Cormagdalena.

Today, the Magdalena River transports 2% of the national cargo that is, basically, oil moved by Empresa Colombiana de Petróleos, Ecopetrol, from Barrancabermeja to Cartagena (2 million tons). The goal is to move transported amount by the river to 6 million tons in 2014, thus cargo currently transported will be tripled. “Entry of the FTA with the United States will make possible that more merchandise, both imports and exports, may be moved by the great national route of Colombia”, emphasized the Executive Director.

scf marine inc. of the United states starts operations in the magdalena river


In December was awarded the contract for Maintenance Works to Deepen the Navigable Canal in the Magdalena River, in the stretch between Puerto Salgar (Cundinamarca) and Barrancabermeja (Santander), equal to 256 kilometers in the center of the country, to be executed in a term of twelve months. Dredging must guarantee a depth of 4.5 feet (1.37 meters). The Executive Director of the Corporación Autónoma Regional del Río Grande de la Magdalena, Cormagdalena, Augusto García, stated that the goal is for the Magdalena River to be navigable 365 days of the year with a depth of 6 feet from Puerto Salgar to Barrancabermeja, and 40 feet at the Access Channel of the Port of Barranquilla.

The Executive Director of Cormagdalena stated that upon the initiation of these works fulfills the Government Plan of President Juan Manuel Santos of making the Magdalena River the great route of the country, enabling competitiveness to the Colombian entrepreneur, helping to reduce costs by using waterway transportation. “We owe a debt to Colombian entrepreneurs by not offering a route allowing them to transport products at low costs.

ColombiaWorks start for the magdalena river to become the Principal transportation route of the country


Colombia’s deficient physical infrastructure, altogether with the low human capital and strict labor markets are hindering productivity of the country and limiting its growing capacity, according to a report of Standard & Poor’s (S&P). “The recent free trade agreement will decrease or abolish import tariffs, but will not alleviate high transportation costs, which are a considerable barrier for Colombian exports”, states S&P. IDB studies show that cost to transport Colombian products to the USA, expressed as part of the value of exports, exceeded the cost of paying import tariffs to the Government of the USA prior to signing the bilateral free trade agreement in 2006.

Despite the strong political support and funding availability, Colombia has faced problems by implementing ambitious infrastructure projects,

said the credit risk agency, although public sector investment has picked up recently thanks to the strong support of President Juan Manuel Santos. Some of the measures supported by present administration have been the creation of the Agency of National Infrastructure (ANI), which replaced the Institute of National Concessions (INCO). “This maneuver reflects the need to overcome delays in the implementation of public-private associations, especially in transportation projects, and approaches corruption accusations of previous projects”, stated S&P. To develop even more the financial markets and infrastructure, Colombia needs a better project design and a more effective implementation, which shall enable local pension funds to invest in infrastructure, according to the credit risk agency.

Deficient Infrastructure Hinders Productivity and growth

in the Magdalena River to and from the center of the country, which the national government is currently determined to achieve. SCF Marine is one of the principal shipping lines operating dry and liquid cargo in the Mississippi River and its tributaries, where it controls 1,200 barges, as well as the Paraguay-Paraná waterway.

The Minister of Transportation, Germán Cardona, -altogether with the President of the Agency of National Infrastructure, Luis Andrade- explained the principal benefits the country will have with the

congress of the republic Passed in december the law of Public-Private associations




Costa RicaaPm terminals signs construction contract for the terminal of containers of moín

Captain Paul J. Galli, General Director of APM Terminals Moín, recent concessionaire of the terminal of Moín for 33 years, informed in Panama during the TOC Americas in November that it had just signed with CH2MHill of the United States (company recently acquired by Halcrow of London), the construction contract, thus denying rumors that project development was delayed, which is considered the largest infrastructure project in

Council of Economic and Social Policies) to be analyzed by the economic authorities of the Nation.

“We expect many national and international players coming to invest in Colombia; this scheme shall serve for the development of ports, airports, railway systems, and anything related to infrastructure. This is a scheme that Colombia needed and that in other countries is in operation”, concluded Minister Cardona.

new Law of Public-Private Associations – PPA, passed by the Congress of the Republic. Cardona confirmed that the PPA Law will serve for road infrastructure works and also to build prisons, schools, hospitals and aqueducts, among others. “We wish to benefit not only the National Government but also the Offices of Mayors and Governors, so private investors may also make proposals to territorial entities”, assured the Minister.

The project has two components: One, the PPA with public resource contributions, which may not surpass 20 percent of project value. The individual must present a detailed proposal to be studied by the Agency of National Infrastructure, and if so decided, the Agency will open a tender where any person may participate, “but bidder entering the initial proposal shall have an advantage in points between 3 and 10%. If another bidder improves the original offer, the first may improve it in 10 days. If this is not done and bidder withdraws, a value will simply be paid for the original offer”, complemented the Minister. The other component is when the investor makes a proposal without requesting public resources, that is, 100% private capital; in this case, the Agency will be in charge of analyzing the possibilities to develop the project.

Another advantage offered by the PPA scheme is that a private investor offering the National Government to execute the works must also operate it and maintain it during a certain time, thus obliging this investor to prepare exact studies and designs so this operation and maintenance will not generate extra costs on his behalf. The maximum term for public-private associations will be 30 years, but if the project does not accomplish financial closure during this time, it will go to the CONPES (National


foresees that the concession will be awarded two months after specifications have been uploaded to the portal, and after the subscription phase for contracts, the government estimates that the entire process will be concluded by the middle of the year, when the port will be operated by private parties. Until now, the concession analyzed is for 20-25 years, but potential investors consider it is short and suggest 30 years or more, with an investment of more than US$100 millions. Up to now there are five international consortiums interested in the concession, including three Chinese firms, one Brazilian consortium and one Chilean consortium.

Originally programmed to be launched in November and awarded in January, the initiative points out transforming the port in a logistics pole for the Manta-Manaus corridor and increasing the capacity to 3 million TEU per year for 2030. As may be remembered, in 2006 the concession of the port of Manta was granted to Terminales Internacionales de Ecuador (TIDE), controlled by the firm with registered office in Hong Kong, Hutchison Port Holdings HPH, for a 30-year term. However, in February 2009, Tide withdrew from the concession and accused the authorities of undergoing unilateral modifications to the contract


EcuadorPuerto de manta will be tendered in early 2012

all the history of Costa Rica. On the other hand, Captain Galli stated that “some of the ports of the region are 20 year back and are now paying the price”, and gave Costa Rica as example, which has one of the highest tariffs of the region as a result of inefficiency. Captain Galli added that to improve efficiency APM Terminals is investing almost US$1,000 million in Moín, including US$124 million in the construction of a 1.5 kilometer breakwater to enable all year round operation, US$192 million to dredge 500,000 cubic meters and US$344 in equipment. During the first phase of the project, the terminal will have 600 meters of dock dedicated to containers with 6 STS post-Panamax cranes and 40 hectares of yards, and the depth of the channel and surroundings will be 16 meters. In the final construction phase, the terminal will have 1,500 meters of docks, 80 hectares of yards, and a depth of 18 meters. Operations are foreseen to start in 2015.

According to Business News Americas, the state-owned Port Authority of Manta – APM – expects to open and award in the first quarter of 2012 the concession of a project that aims to modernize and expand the port, and for this reason they are completing details related to the bidding specifications in order to upload bidding bases to the public acquisition portal in January. The APM


Latin American Port NewsEl Salvador Mexico

Mexico requires investing approximately US$38,000 million in transportation infrastructure during the next six years, including ports, stated Jorge de la Madrid of the School of Civil Engineers of Mexico (CICM, in Spanish), during the presentation of a new proposal for the national infrastructure plan of 2013-2018, highlighted by Business News Americas. Regarding port infrastructure, the questioned construction of the Punta Colonet Port, at the northwest of the country, is still in the agenda, a concession foreseen for 45 years. Although the Secretariat of Communications and Transportation included the project in the national infrastructure plan for the years 2007-2012, with an original budget of US$3,700 millions, it could not be tendered during the present administration. The proposals of CICM in relation to ports include continuing the expansion of Port Lázaro Cárdenas, located in the State of Michoacán.

According to Container Management, the Congress of El Salvador passed a new law in September that was subsequently ratified by the President of the Republic for the concession of the Port of La Unión, at the Gulf of Fonseca, to a company specialized in the operation of sea terminals. The International Finance Corporation (IFC) has been engaged by the government to cooperate in the preparation of the project, find investors and advise in the transaction. According to Enrique Córdova, President of the Autonomous Executive Commission of Ports (CEPA, in Spanish), this authority is now in the process of preparing the new tender that will enable a more open privatization.

As may be recollected, construction of this new port with 900 meters of docks with a depth of 9.5 to 15 meters, and a handling capacity of 850,000 TEU, was completed in 2008 but a first tender for its concession, promoted by the previous government, did not attract offers. This new container terminal is considered the most modern of Central America, after Panama

second attempt for the concession of the Port of la Unión

itransportation infrastructure requires investments of Us$38,000 millions



Nicaragua

hutchison Ports holdings Wins appeal against the concession of the terminal at lázaro cárdenas:

According to BNAmericas, on December 27 the court of appeals ruled in favor of Hutchison Port Holdings HPH and ordered the indefinite cancellation of the concession of the second terminal at the port of Lázaro Cárdenas in the Pacific coast of Mexico, thus stopping signing of the new concession granted on December 15 to APM Terminals B.V. and Controladora de Operaciones de Infraestructura, S.A de C.V., which has been awarded the tender with an investment proposal of US$ 651 million, an amount considered insufficient.

In January 2011, the Federal Tribunal of Mexico ruled against the validity of the tender, honoring the argument of HPH that the port authority (Administración Portuaria Integral de Lázaro Cárdenas -APILAC) had arbitrarily modified its master plan of development. Instead of stopping the process, the Secretariat of Communications and Transportation SCT presented the cause to a court of appeals, and without having ruled the case, APILAC, arguing that the resolution or sentence implying suspension of the contest had not been notified, thus awarded on December 15th the contract for the construction, exploitation, operation and maintenance of the second Specialized Containers Terminal (TEC2) to the group under the leadership of APM Terminals, second global

operator of containers terminals after HPH, and affiliate of the Danish global leader shipping line, Maersk.

A Brazilian consortium under the leadership of the construction company Andrade Gutiérrez, was awarded the contract to develop in a six-month period the prefeasibility studies of this project in the Nicaraguan Caribbean, which shall be followed by a feasibility study with a duration of 18 months, informed Container Management. Total studies will cost US$5 million and, if results are positive, the consortium shall be granted a concession for 25-30 years for the development of the port. The total cost of the project will be US$20/300 millions and, when fully developed, will be in condition to mobilize two million tons. In addition, the port will have two “dry channels”: one corresponding to a 70 km road to Nueva Guinea, from where it would continue to the capital, Managua, by the existing 238 km road, and from there to the port of Corinto through the existing highway of 158 km; the other dry channel would be a railroad between Monkey

another attempt to revive the Project of monkey Point


Latin American Port NewsPoint and Corinto, 500 km long and would cost US$250 millions.

Previous attempts to further this Project have failed: investors from South Korea signed a letter of intention but did not develop any works. However, Virgilio Silva, President of the National Port Company (EPN, in Spanish), stated the Brazilian proposal is much more favorable than that of the South Koreans. According to Orlando Solórzano, Minister of Development, Industry and Commerce, Monkey Point is seen as a strategic development for Nicaragua lacks facilities in the Caribbean, obliging entrepreneurs to use exits by the Pacific. The Minister also stated that at present the exports containers trade must be done through

neighbor Caribbean ports of Honduras (Cortés) and Costa Rica (Limón), which represents an extra cost of 12.5% and 20%, as each frontier pass costs US$950 per container, due to security and the lengthy transportation by road. With the change of traffic to a national deep-water port, estimates are that the private sector would save US$100 million annually. On the other hand, Dean García, Executive Director of the Nicaraguan Association for the Textile Industry, states the sector is very happy with the possibility of the construction of this new port in the Caribbean.

Congratulations for the Congress.

ricardo sánchezChief of Infrastructure and Ports

Cepal, Chile

Congratulations for the excellent seminar.

richard KlienChairman Executive Committee LatinportsPresident Administration Councils of Containers Terminals of Santos Brasil and MultiRío

Brazil

Mail1.- ii latin american Public-Private congress of Ports and i colombian

congress of Ports


It was very interesting to know the situation of the Latin American maritime-port logistics, comparing it with our experiences and thus concluding there are very interesting ways to cooperate between the two parts of the Iberian-American continent.

José maría langaDirector of Logistics Development Valenciaport

Spain

I must thank you for organizing the event and offering me the possibility of presenting some of the experiences we have achieved in Holland.

Jan Willem KoemanGeneral Director Pharos Port Consultancy

Rotterdam, Holanda

I hope next year we may be able to develop new projects with Latinports.

rodrigo isazaAdviser Office of the Superintendent Superintendence of Ports and Transportation

Bogotá, Colombia

I must say that the meeting in Cartagena had an excellent academic and technical quality, with pertinent information of world class port models; excellent motivation to develop port and logistics projects required by Colombia; information we were able to register first-hand, we the persons who make decisions for the future of Colombian ports.

héctor lasernaGeneral Manager Terminal de Graneles Líquidos del Caribe

Santa Marta, Colombia


Thanks for the opportunity of coexisting with Latinports.

leobardo robles Manager of Planning and Development Administración Portuaria Integral de Altamira

México

I am sure we will continue working very hard for the success of the association.

domingo chineaGeneral ManagerSociedad Portuaria Regional de Buenaventura

Colombia

The event was of the highest level.

miguel abisambraGeneral Manager Puerto Industrial Aguadulce

Bogotá, Colombia

I appreciate the opportunity given to my institute.

Joao gilberto camposPresidentinstitute of Professional technical training

Santos, Brasil

Everything turned just fine; excellent event.

alvaro galliPort & Logistic Montes del Plata

Montevideo, Uruguay


Development of the Magdalena River is one of the greatest dreams of President Juan Manuel Santos and one of my greatest commitments.

germán cardonaMinister of Transportation

Colombia

2.- specialized seminar on Upstream navigation in the magdalena river in colombia

It was an excellent seminar and I learned very much.

tim staterEconomic Counselor Embassy of the United States of America

Colombia

I believe the seminar was a great effort on your part and I congratulate you

edgar higueraExecutive Director Chamber of Large Users of Logistics ServicesAsociación Nacional de Empresarios ANDI

Colombia

It was a real pleasure having participated in the seminar organized by you, which I consider a complete success. It is very interesting to see there are titans like you that are convinced of the benefits of the river and how we are wasting them.

nelson cadenaConsultant in Logistics and Transportation

Colombia


I really liked the event and it has been gratifying for me to know that my work has been of use for the project..

alvaro galliConsultant Paraguay-Paraná Waterway

Uruguay

I wish to say that I can see and feel the passion you all have to achieve navigation upstream in the Magdalena River. Please keep yourselves positive and do not fail. Your persistence is very important for Colombia. I spoke of champions and you surely are some of them..

rob davinroyDirector of the Center of Waterway Engineering Application Corps of Engineers of the Army of the United StatesPrincipal Consultant of CDG EngineersSt. Louis, Missouri

USA

I like to follow developments in the Magdalena River and at the same time will continue analyzing the market in Colombia and see if we can do something in the short term as APM Terminals.

robert bosmanManager Development of New Businesses in AmericaAPM Terminals

Panamá

Very interesting the information on Latinports.

germán silvaManager Silva Carreño Asociados

Colombia


I was really happy to be able to contribute a little in such an important discussion for the development of Colombia.

fernando fialhoGeneral Director National Water Transportation Agency Brazil

El Superintendente quedó feliz con la revista que nos dieron en el evento del río Magdalena publicada por Latinports.

rodrigo isazaAdviser Superintendent of Ports and Transportation

Colombia

http://www.latinports.org