Aqaba?s main container terminal ? the only one in the country ? used to be publicly owned and managed by Aqaba Ports Corporation (APC). Privatisation has brought a new lease of life, with the port now expected to become a major regional hub. ‘Aqaba can carve a niche for itself as a key container port for goods coming from Asia seeking a gateway to the Levant and for Iraq, during its reconstruction,’ says Imad Fakhoury, chairman of Aqaba Development Corporation (ADC) and deputy chief commissioner for economic development and investment affairs at the Aqaba Special Economic Zone Authority (ASEZA).
Holland?s APM Terminals, part of the Maersk group, was selected for a two-year contract to manage and develop the container terminal. The agreement is planned to be converted into a 25-year joint venture with ADC.
Congestion was one of the main problems that plagued the port, along with an inefficient and cumbersome bureaucracy. Interference from various government bodies caused delays and raised the cost of services.
‘Customs clearance procedures were simply taking too long, sometimes lasting up to 30 days,’ says Omar Salfiti, business development manager of Al-Tajamouat industrial city, a qualified industrial zone (QIZ) based in Amman. ‘These delays encouraged foreign investors to use Haifa, in Israel, which was substantially more expensive. Ever since the port was privatised, Aqaba has improved.’
Some dramatic changes have resulted. According to APM figures, the average anchorage waiting time for ships delivering their cargo was reduced from 42 hours in July 2004 to four hours by January 2005. The transit processing time of Jordanian QIZ exports to the US has also been cut from 24 hours to 12. ‘It was simply a case of getting the basics right,’ says Patricio Junior, APM Terminals managing director. ‘Whereas before there were no clear lines demarcated for each container, simply by putting them in we have increased efficiency.’ Since taking over, APM has cancelled the previous congestion fees and brought the terminal up to international standards by improving storage facilities and security. There are also plans to computerise the management of the terminal within a year.
The cargo terminal developments are an integral part of the wider ASEZA masterplan. There are also plans to move what are currently the main port facilities. At present, holidaymakers are greeted by the sight of cargo ships near the beaches, which jars somewhat with expectations gained from browsing the tourist brochure. Alongside the probable rise in marine traffic from large tourism developments currently being built, this makes the relocation of the port likely.
‘As part of our 15-year business masterplan, we plan to relocate the main port facilities in the north to the southern industrial zone near the Saudi border,’ says Fakhoury. The cost of the move is estimated at $800 million and the move will release about 200,000 square metres of land identified for real estate development. The plan is to free up the existing passenger terminal at the port and move all roll-on, roll-off (ro-ro) cargo services to the south.
The revenues gained from the cargo terminal, as part of ADC?s joint venture with APM, will be used to fund urban regeneration projects in Aqaba, as well as the privatisation of the logistics park and King Hussain International Airport. As privatisation of the terminal has proved, income for the area looks set to increase further in the future.