The federal government of Somalia has reportedly revoked the contract signed between the UAE-based port operator DP World and Somaliland, according to Reuters.
The move is being announced on the heels of the final agreement signed on March 4, 2018 by DP World and the Republic of Somaliland, an autonomous region of Somalia, to develop a greenfield economic free zone in Somaliland to complement the Port of Berbera’s growth.
DP World said that it expects to break ground on the 12 square kilometre free zone project, located next to the port, this year.
Furthermore, the parliament of Somalia is said to have passed a resolution banning DP World from working in the country due to the port operator’s breach of Somalia’s constitution and rules on foreign investment.
DP World is yet to provide World Maritime News with a statement on the matter.
The dispute arises in less than a month from neighboring Djibouti’s contract termination with DP World for the Doraleh Container Terminal (DCT).
The decision has prompted DP World to launch new arbitration proceedings in London against the Government of Djibouti as it dubbed the move illegal.
The Government of Djibouti, on the other hand, attributed the decision to the poor performance of the container terminal.
World Maritime News Staff