Puntland to terminate $336M contract with DP World at Bossaso Port

For the past years, Puntland businessmen have been putting pressure on the government to end the DP World, saying they are disappointed with investing in the port of Bossaso as long the impediment exists.

News Keydmedia Online
8 March 2022

BOSSASO, Somalia – Puntland state in northeastern Somalia wants to terminate a deal with the UAE’s DP World at Bossaso port after the company failed to fail to articulate the commitments it promised.

In 2017, P&O Ports, a subsidiary of DP World has won a 30-year concession for the management and development of the port on the Gulf of Aden following a deal worth $336 million with the regional state.

Puntland Ports Minister Ahmed Yassin Salah confirmed that the port will be handed over to an unnamed firm to develop and expand Bossaso seaport, which serves as the financial nerve center of the region.

P&O ports faced a security threat to its staff after the assassination of Paul Formosa, a Maltese man who was its head of operations at Bossaso port in February 2019 by the Al-Shabaab group. The murder affected the entire work.

For the past years, Puntland businessmen have been putting pressure on the government to end the DP World, saying they are disappointed with investing in the port of Bossaso as long the impediment exists.

Puntland expected the concession agreement of expanding the Bosasso port to contribute to its economic growth and trade potential. The hope for the deal has been dashed due to insecurity in Bossaso, which is surrounded by Al-Shabaab and ISIS.

Last November, the city has seen a deadly three-day battle between troops within the Puntland security forces after PSF director Mohamud Osman Diyano rejected a dismissal by president Said Deni.

As UAE eyes investment in Somalia, the DP World also signed a US$442 million agreement with the breakaway region of Somaliland in 2016, to operate a regional trade and logistics hub at Berbera Port. Ethiopia has acquired a 19 percent stake in the Port of Berbera.

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